UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _______________________ FORM 10-Q _______________________ x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2016 OR ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 1-6961 ___________________________ TEGNA INC. (Exact name of registrant as specified in its charter) ___________________________ Delaware 16-0442930 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 7950 Jones Branch Drive, McLean, Virginia 22107-0150 (Address of principal executive offices) (Zip Code) Registrant’s telephone number, including area code: (703) 854-7000. Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨ Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one): Large Accelerated Filer x Accelerated Filer ¨ Non-Accelerated Filer ¨ Smaller Reporting Company ¨ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ¨ No x The total number of shares of the registrant’s Common Stock, $1 par value outstanding as of March 31, 2016 was 217,587,943.
INDEX TO TEGNA INC. March 31, 2016 FORM 10-Q Item No. Page PART I. FINANCIAL INFORMATION 1. Financial Statements 3 Condensed Consolidated Balance Sheets as of March 31, 2016 and December 31, 2015 5 Consolidated Statements of Income for the Quarters Ended March 31, 2016 and March 29, 2015 Consolidated Statements of Comprehensive Income for the Quarters Ended March 31, 2016 and March 29, 2015 6 7 Condensed Consolidated Statements of Cash Flows for the Quarters Ended March 31, 2016 and March 29, 2015 Notes to Unaudited Condensed Consolidated Financial Statements 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 21 3. Quantitative and Qualitative Disclosures about Market Risk 29 4. Controls and Procedures 29 PART II. OTHER INFORMATION 1. Legal Proceedings 30 1A. Risk Factors 30 2. Unregistered Sales of Equity Securities and Use of Proceeds 30 6. Exhibits 30 SIGNATURES 31 2
PART I. FINANCIAL INFORMATION Item 1. Financial Statements TEGNA Inc. CONDENSED CONSOLIDATED BALANCE SHEETS In thousands Mar. 31, 2016 Dec. 31, 2015 (Unaudited) ASSETS Current assets Cash and cash equivalents $ 79,206 $ 129,200 Trade receivables, net of allowances of $9,406 and $9,092, respectively 561,489 556,351 Other receivables 19,775 18,738 Prepaid expenses and other current assets 87,584 94,262 Current discontinued operation assets — 6,608 Total current assets 748,054 805,159 Property and equipment Cost 994,974 984,185 Less accumulated depreciation (543,960) (525,866) Net property and equipment 451,014 458,319 Intangible and other assets Goodwill 3,956,113 3,919,726 Indefinite-lived and amortizable intangible assets, less accumulated amortization 3,051,845 3,065,107 Investments and other assets 262,147 256,990 Noncurrent discontinued operation assets — 657 Total intangible and other assets 7,270,105 7,242,480 $ 8,469,173 $ 8,505,958 Total assets The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 3
TEGNA Inc. CONDENSED CONSOLIDATED BALANCE SHEETS In thousands, except share amounts Mar. 31, 2016 Dec. 31, 2015 (Unaudited) LIABILITIES AND EQUITY Current liabilities Accounts payable and current portion of film contracts payable $ 102,924 $ 124,654 Accrued liabilities 279,121 296,815 Dividends payable 30,704 31,033 Income taxes 27,264 15,742 Deferred income 138,363 132,650 Current portion of long-term debt 646 646 Current discontinued operation liabilities — 5,243 Total current liabilities 579,022 606,783 Noncurrent liabilities Income taxes 16,965 18,191 Deferred income taxes 889,977 883,141 Long-term debt 4,196,722 4,169,016 Pension liabilities 176,267 178,844 Other noncurrent liabilities 152,481 168,573 5,432,412 Total noncurrent liabilities 5,417,765 6,011,434 Total liabilities 6,024,548 Redeemable noncontrolling interests 26,088 24,666 Commitments and contingent liabilities (See Note 12) Equity TEGNA Inc. shareholders’ equity Common stock of $1 par value per share, 800,000,000 shares authorized, 324,418,632 shares issued 324,419 324,419 Additional paid-in capital 474,484 539,505 7,166,528 Retained earnings 7,111,129 (131,137) Accumulated other comprehensive loss (130,951) (5,676,713) Less treasury stock at cost, 106,830,689 shares and 104,664,452 shares, respectively (5,652,131) 2,157,581 Total TEGNA Inc. shareholders’ equity 2,191,971 274,070 Noncontrolling interests 264,773 2,431,651 Total equity 2,456,744 8,469,173 $ $ 8,505,958 Total liabilities, redeemable noncontrolling interests and equity The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 4
TEGNA Inc. CONSOLIDATED STATEMENTS OF INCOME Unaudited, in thousands, except per share amounts Quarters Ended Mar. 31, 2016 Mar. 29, 2015 Operating revenues: Media $ 443,829 $ 396,417 Digital 337,903 335,074 781,732 Total 731,491 Operating expenses: Cost of revenues and operating expenses, exclusive of depreciation 248,256 226,577 Selling, general and administrative expenses, exclusive of depreciation 281,034 264,751 Depreciation 22,233 24,279 Amortization of intangible assets 28,290 28,688 Facility consolidation — 4,724 Total 579,813 549,019 Operating income 201,919 182,472 Non-operating (expense) income: Equity income (loss) in unconsolidated investees, net 2,933 (1,249) Interest expense (61,713) (70,670) Other non-operating items 2,379 24,464 Total (56,401) (47,455) 145,518 Income before income taxes 135,017 42,108 Provision for income taxes 51,015 103,410 Income from continuing operations 84,002 (7,474) Income (loss) from discontinued operations, net of tax 43,481 95,936 Net income 127,483 (10,492) Net income attributable to noncontrolling interests (14,590) $ 85,444 $ 112,893 Net income attributable to TEGNA Inc. 0.42 $ Earnings from continuing operations per share - basic $ 0.31 (0.03) $ Earnings (loss) from discontinued operations per share - basic $ 0.19 0.39 $ $ 0.50 Net income per share – basic 0.42 $ Earnings from continuing operations per share - diluted $ 0.30 (0.04) $ Earnings (loss) from discontinued operations per share - diluted $ 0.19 0.38 $ Net income per share – diluted $ 0.49 Weighted average number of common shares outstanding: 219,286 Basic shares 227,089 223,254 Diluted shares 231,931 Dividends declared per share $ 0.14 $ 0.20 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 5
TEGNA Inc. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Unaudited, in thousands Quarters Ended Mar. 31, 2016 Mar. 29, 2015 95,936 $ Net income $ 127,483 (925) Redeemable noncontrolling interests (income not available to shareholders) (1,233) Other comprehensive income (loss), before tax: Foreign currency translation adjustments 1,201 (32,309) Pension and other post-retirement benefit items: Recognition of previously deferred post-retirement benefit plan costs 1,900 15,077 Other — 18,539 Pension and other post-retirement benefit items 1,900 33,616 Unrealized loss on available for sale investments during the period (1,983) — Other comprehensive income, before tax 1,118 1,307 Income tax effect related to components of other comprehensive income (loss) (738) (9,141) Other comprehensive income (loss), net of tax 380 (7,834) Comprehensive income 95,391 118,416 (10,133) Comprehensive income attributable to noncontrolling interests, net of tax (7,791) 85,258 $ Comprehensive income attributable to TEGNA Inc. $ 110,625 The accompanying notes are an integral part of these unaudited consolidated financial statements. 6
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